Headcount at UK firms continues to increase

According to research from PwC’s 25th Annual Law Firm Survey, headcount at UK private practices continues to increase across the Top 10, Top 11-25 and Top 26-50, even with Brexit vote. Headcount has also increased in the international operations of the Top 50, as well as across all bandings in the UK, albeit at a slower pace.

Headcount grew at the fastest pace within the Top 10, increasing by 8%, followed by the Top 26-50 and then the Top 11-25 where headcount grew by 6% and 3% respectively. Firms continue to adopt diverse approaches to structuring their teams, most notably the Top 11-25, which has increased partner numbers, decreased qualified fee earners and bolstered their business support departments. However, it has also become clear that firms continue to manage full equity partner headcount closely, particularly the Top 26-50, with no year on year increase.

The research highlights a slight dip in utilisation, with average chargeable hours dropping across almost all grades and bandings in the Top 50 firms. This suggests that they will likely shift greater emphasis onto creating effective resourcing strategies to ensure that any further investment into increased headcount translates into tangible growth.

The report also suggested that while firms may take a more cautious approach to hiring until the nature of the UK’s ongoing relationship with the EU becomes clearer, firms are likely to adopt more effective and flexible workforce planning and resourcing solutions to ensure that demand is met in the busiest legal markets. It’s also likely that UK fee earners may be assigned international work to minimise excess capacity.

While a number of commentators suggested that Brexit would have a catastrophic impact on headcount, many firms appear to remain optimistic about the current market, and are keen to adopt more flexible resourcing strategies before cutting headcount. In fact professionals may benefit from increased exposure to international work and clients.